I use levelling feature for construction projects extensively (2003 version). I have customised the productivity norms for various tasks as company standards in custom fields using the outline code,value list. This facilitates calculation of gangdays in a customised field based on the quantities in another custom field. Depending on the availablity of work front and site conditions I assign the gangs to various tasks. Since there are many same type of gangs required in different work areas of the project , levelling enables me to know the max number of gangs required simultaneously during the entire project duration. I reduce this max number first by levelling within available slack and it is successful at times. If it is not possible,I level it further and see how far the project extended and watch those tasks extending it.
Indeed the whole purpose of using MS project is for this very important feature of MS Project. I have used Primavera P6 but I feel the levelling in MS Project is much more logical,simple and practical.